1:1 Split Soon: Tata’s Auto Stock Is Down By 40% From 52-Week High, Acquisition Of Rs 38,000 Crore Ahead; BUY?

However, despite this, there is a buy-on-dips opportunity in this Tata stock. On Friday, brokerage Devan Choksey has recommended ACCUMULATE on Tata Motors.

Key positives for Tata Motors going forward are expansion plans, the demerger of business, the acquisition of Italian truck maker Iveco, and the electric vehicle segment. However, US tariffs remain a key concern.

1:1 Split Soon:Tata Motors Share Price:

At the time of writing, Tata Motors’ share price performed at Rs 682.05 apiece on BSE, down by 0.50% with a market cap of Rs 251,092.64 crore. The stock touched an intraday low of Rs 680.30 apiece in the early trade.

From the day’s low, Tata Motors is down by a little over 40% from its 52-week high of Rs 1,142.00 crore. Noteworthily, Tata Motors’ return on equity (ROE) is a healthy28.12% as of August 22, 2025.

1:1 Split Soon:Why BUY Tata Motors Stock?

According to analysts at Deven Choksey, Tata Motors management guides for single-digit growth in FY26E for PV/CV, with Q2FY26E recovery on a low base. PV growth is expected to remain in the range of ~1.0-2.0% in FY26E amid muted sentiment, with Altroz/Tiago refresh aiding hatch share recovery, and Sierra EV/Harrier EV launches boosting UV positioning. EV mix is seen rising to ~17.0% in Q2FY26E, supported by festive demand.

Further, in their report dated August 22, 2025, the analysts said, “We have revised our FY26E/FY27E EBITDA estimates by -10.4%/-6.5% respectively, factoring weaker JLR margins and subdued domestic demand.”

“We have roll-forwarded our valuation basis to Jun’27 estimates. We value Tata Motors on a SOTP basis, implying a target price of INR 722 per share. We maintain our “ACCUMULATE” rating on the stock,” said the analysts.

1:1 Split Soon:Tata Motors Acquisition:

Recently, Tata Motors announced the plan for acquisition of Iveco Group N.V. through a tender offer. Iveco is a leader in European commercial market. The deal is a worth whopping Rs 38,000 crore.

As the analysts, Tata Motors is set to acquire Iveco’ business (through a voluntary tender offer) at an offer price of EUR 14.1/share valuing it at an equity value of EUR 3.8 billion (~INR 380 billion), subject to the spin-off of Iveco’s defence business. The transaction is expected to be funded by 60-70% of debt and rest through internal accruals with potential monetization of its 4.7% stake in Tata Capital. The transaction is targeted to be closed by FY26E.

The acquisition is planned with a strategy to expand its portfolio, adding emerging technologies including ADAS and SDVs, and strengthening its talent base. Post-integration, Tata Motors will rank third globally in trucks above 6T (~2.3 lakh combined volumes). Iveco’s strong product lineup and footprint across Europe and Latin America will improve its access to premium segments. Revenue synergies will stem from complementary portfolios, while capex savings are expected via consolidated R&D. Cost efficiencies are anticipated from improved sourcing in new geographies, as per the analysts.

Tata Motors is also set to demerge its business in 1:1 split ratio.

Tata Motors Split:

In its latest filing, Tata Motors said the final hearing for the scheme of demerger has been concluded today by NCLT and the order is reserved; we aim to complete it this quarter, with 01st October being the Effective Date.

The company is going to demerge its business into two listed entities in due course. One will be focused on commercial vehicles (CV) and the other will emphasise the passenger and JLR cars segment.

As part of the demerger plan, Tata Motors shareholders will get 1 share of TMLCV with a face value of Rs 2 each for every 1 share held in the company. This makes the business split ratio 1:1.

Disclaimer: The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.